Crime Prevention Officer Gordon Sims is warning Visa and Mastercard holders to be cautious when dealing with the credit card companies over the phone – the caller may not be who they say they are.
Sims has reported credit card customers receiving phone calls, purportedly from the security or fraud department at Visa or Mastercard, requesting a purchase verification, address and the three-digit code on the backside of the card.
“The caller says, 'I need to verify you are in possession of your card' and asks for the three digit number on the back,” said Sims in an email release. “After providing the three digit number, this information is then used to make a purchase on your card.”
According to Sims, the caller will usually say the credit card has been flagged for “an unusual purchase pattern,” referring to an anti-telemarketing device costing from $297 to $497 from a company based in Arizona.
The amount of the purchase to be verified usually sits below the $500 mark – what Sims says is the amount that would usually flag unusual credit card activity.
When the cardholder indicates they did not make the purchase, Sims says the scammer will usually ask for an address, and tells the holder that a fraud investigation has been started.
For any questions, the cardholder is told to call the 1-800 number on the reverse side of their credit card and reference a six-digit control number.
After the scammer has all the information they need, a fraudulent charge is made to the credit card.
“If you give the scammer your three-digit PIN number, you think you're receiving a credit,” said Sims.
“However, by the time you get your statement, you'll see charges for purchases you didn't make, and by then it's almost too late and/or more difficult to actually file a fraud report.”
According to the Credit Card Fraud department of the RCMP, telephone, mail and online purchases cost Canadians $176,115,080 in 2010.
Anyone who thinks they may have been a victim of the scam, or has questions about how to avoid it should call the Canadian Anti-Fraud Centre at 1-888-495-8501.